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One of the developers of XenForo, Kier Darby, originally served as a lead developer for the community platform vBulletin. The original owner of the software, Jelsoft, was acquired by the American new media company Internet Brands in 2007. Disagreements occurred between the developers and the new management over matters involving the next major release of vBulletin, version 4.0. While the team wished to make 4.0 a complete rewrite of the platform, Internet Brands insisted on using agile development atop the existing code instead. These internal conflicts resulted in most of the vBulletin developers stepping down from employment at Internet Brands in 2009. As part of a new team, Darby and other former vBulletin developers began work on a new platform known as XenForo.[3][4]

One day before the originally scheduled release for the first public beta of XenForo in October 2010, Internet Brands announced that it would file a lawsuit against the XenForo team in the UK, claiming: copyright infringement of property acquired by Internet Brands, that code in XenForo was refactored from vBulletin code, breach of contract, and engaging in unfair business practices.[4] Representatives also claimed that XenForo "unfairly stands on the shoulders of more than a decade of development", development which had become the property of Internet Brands through the acquisition. In November 2010, Internet Brands sued XenForo and Darby in California District Court in the United States, additionally claiming that Darby had not returned confidential information from Internet Brands regarding the vBulletin software, though failing to provide evidence to back this claim. The XenForo team has denied the claims made by Internet Brands in these lawsuits. Internet Brands also denied that the timing of the lawsuit was to coincide with the first public beta of the software.[5]

On October 17, 2011, the plaintiff Internet Brands amended their complaint to alter several new allegations based on newly discovered information, and further added new individual defendants to the case, including developer Mike Sullivan and Business Manager Ashley Busby. The defendants' motion to dismiss this amended complaint was denied by Judge Real.

On January 4, 2012, Judge Real granted in part and denied in part the defendant's motion to dismiss claims in the amended complaint. The following claims were dismissed: "Violations of California Business and Professional Code", "Conspiracy", and "Violation with regards to RICO". All other claims, including "Violation of CFAA", which was initially denied by the same judge earlier in 2011, remained standing.

On March 26, 2012, the plaintiff cited their intention to issue a third amended complaint to alter claims against developer Mike Sullivan.

On February 28, 2013, XenForo announced that the lawsuit had been settled between the parties in both the UK and the US. Although specific terms of the agreement are unclear due to its confidential nature, Internet Brands withdrew both the US and UK lawsuits.[7] As a "Thank you" to customers who patiently awaited the result of the lawsuit, XenForo announced that all license holders with a valid license from June 19, 2012, would receive an additional 255 days of support and download access.[8]

The second major release of XenForo is XenForo 2.0. In November 2016, a demo version of the alpha was launched by XenForo. In February 2017, the first two developer previews were released by XenForo. The developer previews are unsupported releases targeted at developers to review the new codebase, and as such contain no web-based installer or import features. In September 2017, the first beta was made available to all active customers. On 28 November 2017, the first stable release of XenForo 2.0.0 was made available.